The No.1 Rule For Music Startups: Not to Tell People You Are Funded

Starting a startup then getting funded is always a good news to share with the public (You may not want to reveal the exact amount of the funding, though). But for music startups, at least in China, the fundraising status seems a highly classified information.

No.1 rule: don’t tell people you are funded, which is what I’ve been told by several music startups.

The reason sounds simple. Usually startups when they starts don’t have money to pay for the license fee, so most startups have to play with the pirated music content. The music publishers know that they will get little or even nothing if they sue the startups for copyright infringement. But if they know you have extra money in pocket, they will not let you walk away easily. “The licensing fee is now an important revenue source in digital music industry.” a startup founder, who has years of experience in music industry and recently founded a mobile music service, said so.